Sony nearing deal to buy out Ericsson

Friday 7 October 2011 07:50 BST

Sony is nearing a deal to buy Ericsson's half of their smartphone joint venture in a bid to catch up with rivals including Apple by unifying its mobile phone products under a single brand, according to reports today in the Wall Street Journal.

The move is aimed at helping Sony reclaim ground in its battle with Apple and Samsung, where it has been hampered by the disparate structure of its products and online content offerings.

Tablets, games devices and other consumer electronics are sold under the Sony brand, while smartphones come under Sony Ericsson.

Sony and Ericsson have been talking for weeks about the future of the 50:50 joint venture because the companies must decide this month whether to renew their 10-year-old pact.

Yoshiharu Izumi, an analyst at J.P. Morgan in Tokyo, said the deal could be worth upwards of $1.3 billion, depending on an agreement about the continuing use of Ericsson's telecoms patents.

"Up to now Sony's products and network services have all been separate. Unifying them would be positive," Izumi said. "If they can leverage their games and other network services I think they can lift their share."